Editorial #101 Art of Tariffs
The words “The Art of War” seems like a contradiction, but it is a book written by a Chinese General, Sun Tzu, about 500BC. It is a simple outline of how and why wars are fought. It applies to trade wars as well. I have done editorials on tariffs and war (#70 and #79) with these issues continuing to linger and be mischaracterized with self-serving, short sighted agendas by those who do not understand the art of war.
Wars are part of the natural law: “Might is right” and “survival of the fittest”. It should be the survival of those who are “right”, but is usually overpowered by “might”. Roosevelt’s motto: “Speak softly and carry a big stick” is the way diplomates try to operate with the mantra “peace through strength” seeming to work best. This applies to gun control issues as well.
The radical approach of liberal elites is to complain, yell and encourage riots if they do not get their way. This is not war, it’s anarchy. This never solves any problems, often making things worse while finding more victims to join the movement.
I hate tariffs and war as much as I hate death and hypocrisy. They have always existed and are unavoidable when others have differing opinions. There is a saying: “If two people in a room always agree, one of them is not necessary.”
There will always be disagreements on how to fix things. But, when the objective is fully defined, the problem is practically solved. All solutions must be fair, truthful, sustainable and have no self-serving agenda. Lacking agreement on these core values is always where the problem lies.
Wars are only fought when the two sides disagree on what is fair, truthful or sustainable. They are not fought because we lost a world cup soccer game. If there is no agreement on these core values, then “might” will determine what is fair, truthful and sustainable. But, political correctness is eroding what is fair, truthful or sustainable with the hypocrisy of self-serving agendas, disguised as compassion and tolerance.
Without exception, all wars are fought over disagreements on core values. This explains the motives of the liberal elites that infects our public schools and colleges. It allows situational ethics, immediate gratification and political correctness to be the rules that makes a socialistic society easier to control.
The trade war is being waged because China is violating all these core values: They are not truthful by stealing our technology, they are not fair by manipulating their currency, they violate the rules of economics by dumping products into our market at a loss which is not sustainable and they are hypocritical by their definition of competition being: cheating without getting caught.
Wars are very expensive. The decision to wage a war is determined by asking: “How much will be lost if war is not declared?” This amount the most that should be spent on waging that war. With the situation regarding tariffs, the cost is not having a 2% economic growth rate. The decision is easier when China’s economic loss is found to be much higher than ours because their economy is much more vulnerable to economic swings. Because of their size, if their economy implodes, the likelihood of revolt and anarchy is very real in spite of the fact their citizens not have guns. Simply, we can hold our breath longer and we have more to gain than they have to lose.
I wish these answers were easy and painless, but anything in life worth having is never free. At least there is no bloody body count in a trade war, only money being lost. But the expense of a trade war is considerably less than the cost of having China continues to cheat which has been going on for decades with no sign of stopping without tariffs. This is the only way to get their attention.
We lose jobs, intellectual property and sales of things we make and grow. These decisions are difficult, but if they were easy the problem would already be solved. This is why “profiles in courage” are so important. It takes business and economic understandings to win at this game, not diplomacy that fixes nothing. It is like winning a chess game by being able to see more moves ahead than your opponent. Thank God this is the approach being used now, not allowing the United States to cower or be intimidated into accepting business as usual from world trading powers who are cheating us.
This is Keith Kube wishing you the best in making the world a better place.